Deliveroo eyes $10.5 billion listing after some funds steer clear
Deliveroo will price its initial public offering at 390 pence per share, banks working on the deal said on Tuesday, at the bottom end of previously indicated valuations for the food delivery group.
That would indicate a valuation of 7.6 billion pounds
($10.46 billion), less than expected, after a string of major UK fund managers
said they would not take part in the deal, citing concerns about its dual class
share structure and its gig economy business model.
The listing is covered multiple times over, the bookrunners
said, with the deal expected to close at 1200 GMT.
The listing of London-based company, founded by boss William
Shu in 2013, is set to be London's biggest IPO since Glencore's in May 2011 and
also the biggest tech float on the London Stock Exchange.
Heavyweight investors Aberdeen Standard Life, Aviva, Legal
& General Investment Management and M&G have all said they will sit the
deal out, amid criticism of its workers' rights.
Some of them also question whether the loss-making business
can ever justify its valuation.
Having initially looked for up to 8.8 billion pounds, the
British tech firm on Monday went with a narrower price range, indicating a
maximum valuation of up to 7.85 billion pounds.
Deliveroo's self-employed drivers have seen a boom in demand
during the COVID-19 pandemic, bringing food from otherwise-shuttered
restaurants to housebound customers.
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